Universal vs Disney Over Marvel Characters

EXCLUSIVE: With help from a number of key sources inside and outside Universal studios and Universal theme parks, I’ve put together the latest info about which Marvel characters and which deal points Universal and Disney might fight over in coming months and years. And, trust me, there will be blood as pitbull lawyers on all sides tear apart the language of each and every contract clause. (This is exactly the sort of Big Media mortal combat that Disney and GE in-house attorneys, and their outside counsel — oooh, those billable hours — thrive on.) And yet Disney’s Bob Iger and Universal’s Ron Meyer are longtime pals. It remains to be seen if that relationship can withstand this confrontation.

Recent Comments

Universal should just get it over with and fork over the rides, chracters et al. They could...

Melissa Harper

5 years

As far as I know, the only outside licensing Disney does is with the Star Wars universe....

Ted

5 years

Once Disney starts REALLY promoting these characters (and MORE importantly, profitting off them), I suspect that most...

Attractions (Characters licensed for the attraction use, but not necessarily for walk-around. Some in the attractions list are also licensed for walk-around, but not all.): Spider-Man, Doc Oc, Scream, Electro, Hydro-Man, Hobgoblin, J. Jonah Jameson, Hulk/Bruce Banner, Dr. Doom, Fantastic Four (as a group, not individually), Storm, Magneto, Professor X.

Complicating everything are several shows as well, both impromptu outdoor shows put on by Entertainment, and larger shows that were put on in conjunction with Universal Creative/Marvel. No one is sure what the status would be regarding those characters/properties. Regardless, informed sources tell me that if Universal wanted to reuse the characters, they’d only be able to use the characters in a similar way — ie, the same show, or a similar show.

I’m told that this is because the Universal-Marvel licensing contract is extremely narrow: Universal has to follow it to the letter, or they risk losing the characters altogether. Universal’s parks group structures contracts so that there’s a master licensing agreement for the Marvel name, and then individual sections for the properties. It’s not a catch-all, you-have-a-blanket-license-to-use-any-Marvel-character-as-you-see-fit-in-your-parks, because Marvel’s not stupid. And because Marvel owns high-profile characters (it’s like this for most non-owned properties), Universal must get approval for any additional/future use of Marvel’s characters so Universal doesn’t use the characters in a way Marvel doesn’t like. For that reason alone, Marvel has a big ol’ out in their contract with regards to future use.

The existing deals are in place, but if Universal had planned to use a Marvel character they hadn’t used yet, they would obviously have to run it by Marvel for approvals. The way it works is a new addendum would then be drafted for that use/use of that character, and added to the master license agreement. The characters that are already used can continue to be used as they have been since they’re part of the initial deal. But I’m told not to expect any new major characters introduced into the park, or existing ones expanded for use, though.

Universal’s current attractions are safe, as are the themed eateries/shops. Any Marvel characters not used presently by Universal will most certainly not be used from here on. The walk-around characters that are not connected to an attraction or eatery could be in danger, as that clause is more easily manipulated. The use of the characters for walk-around is usually a separate contract than the rides/overall naming rights, and is usually much more flexible. So these could be the first to go in the years to come. (Which is why that “we believe” may have been in Universal’s initial statement to me…)

As if this isn’t complex enough, Universal Studios Hollywood actually had Marvel characters doing “streetmosphere” until January 2008, when they didn’t renew the license. In fact, Marvel wanted an expansion of the brand into the park and pushed for an attraction to be built using their characters, like Islands Of Adventure. But Universal didn’t want to spend the money. Also Marvel wanted more moolah for the licensing agreement renewal, which Universal wanted to cut back. In the end, Universal severed ties with Marvel for the West Coast park, while maintaining an amicable relationship for the Orlando park.

Also, further entangling everyone and everything is the fact that Marvel is building their own Super Heroes park down the road from Universal’s new park in the massive (and very delayed) Dubai-land project in the Middle East. The question here is whether Disney will now try to turn it into a Disney park or leave it as a Marvel park, or both, or neither.

So what does the future hold?

Obviously, Universal lawyers right now are scrutinizing their theme park licensing and merchandising contracts with Marvel. Universal at first issued to me this statement to me about the future of their theme park licensing pact with Marvel: “Marvel Super Hero Island at Universal’s Islands of Adventure and the Marvel characters are a beloved and important part of the Universal Orlando experience. They will remain so. Our guests are going to get to meet Spider-Man and all our other Marvel characters. We believe our agreement with Marvel stands and that the Disney/Marvel deal will have no impact on our guest experience.”

Hmm, interesting how there was a “we believe” in there. Sounded unsure. Then Universal updated its earlier statement to me to say this much more assuredly, “Marvel Super Hero Island at Universal’s Islands of Adventure and the Marvel characters are an important part of the Universal Orlando experience. They will remain so. Our agreement with Marvel stands for as long as we follow the terms of our existing contract and for as long as we want there to be a Marvel Super Hero Island.”

Privately, Universal execs told me they’ve got the Marvel characters “until the end of time if we want them” and used phrases like “in perpetuity”. But here’s the rub: a Universal insider tells me the theme parks only retain the existing characters it’s already made use of. Sure there are Spider-Man and Hulk attractions, but what about the bulk of the 5,000 Marvel characters? Are those Disney’s now?

Those character rights revert to Marvel, so, Disney can start incorporating those Marvel characters immediately into Disney’s theme parks in California, Paris and Hong Kong. But it’s important to note that the Disney/Marvel deal statement yesterday did not mention Marvel in connection with Disney theme parks. In fact, Disney may not be able to use the best known of the 5,000 Marvel characters to freshen its theme parks for some time. Because Universal theme parks have a long-term licensing deal with Marvel that gives Universal exclusive rights for Marvel characters east of the Mississippi for theme park use. Still, this leaves open options for Marvel characters at the California Disney parks, although some sources doubt the Mouse House would do that immediately, as it could contribute to brand confusion by having Marvel characters at Universal on one coast (in Orlando) and Disney on the other (in Anaheim).

For specific characters/properties (i.e., ones where Universal has invested a huge amount of money, like the Spider-Man ride), the Universal/Marvel licenses are virtually in perpetuity and will outlast the rides themselves. My insiders predict that Disney will try to buy those characters out in the distant future — probably when the rides are changed/closed or the entire Marvel Island is changed/closed.

Finally, yesterday a Universal spokesperson told me that the studio has built in Marvel attractions not just at theme parks in Orlando and Osaka but also into future theme park plans. But an informed outside source tells me this isn’t true and that Universal has no new attractions on the boards right now based on Marvel characters for Dubai or Singapore or even Orlando’s Islands Of Adventure/Marvel Island. Instead, Universal is consumed with getting its new “Wizarding World Of Harry Potter” attraction with Warner Bros up and running.

15 Comments

What a friggin mess. The lesson is that Universal was asleep at the wheel and should have thought to do what Disney did about 100 times over.

Lytton Strachey • on Sep 1, 2009 7:11 am

So the actor playing Spiderman at the Marvel cafe can relax. His job is safe.

cst • on Sep 1, 2009 7:11 am

Am I the ONLY one who wants to see a J.Jonah Jameson ride?

working WGA writer/comic nerd • on Sep 1, 2009 7:11 am

Stop giving short shrift to CYCLOPS in X-men movies!

licensedtorock • on Sep 1, 2009 7:11 am

Everyone is missing the big and 3 to 5 year picture…the 5000 new Marvel characters which Disney just acquired and that can now be turned into new Pixar and Disney live action films that will generate billions of dollars, not only at the box office and with DVD’s, but at retail across all product platforms and at Disney’s theme parks- the world over. Add to that, the immediate and on-going license revenues which Disney will enjoy, in some cases, in perpetuity.

It will be interesting to see if Disney now tries to make some of the unlicensed characters more prominent, e.g. Luke Cage, Dead Pool, etc. We may see a shift from focus on Spidey, Wolverine and the Hulk.

lsb • on Sep 1, 2009 7:11 am

and don’t forget, Universal gave up the rights to Marvel Characters west of the Mississippi River. So Disney can put anything it wants in Disneyland/California Adventure but they can’t put them in Disney World. Universal didn’t want to cough up the money to keep Marvel characters at the Hollywood theme park.
Paramount only has the Film rights to a few until 2012/2013 then they go to Disney.

Universal isn’t the sharpest company around.

And just think, Universal, Fox, Paramount, and even Sony will be paying Disney. Which I think is funny in itself.

nemo • on Sep 1, 2009 7:11 am

Re: licensedtorock: The film rights for Luke Cage and Deadpool are at Sony and Fox, respectively. Marvel can’t touch them. They do have Hulk, though, and it’s pretty likely that you’ll see Hulk both in The Avengers and in a sequel to the 2008 film.

An Iron Man attraction would have obvious appeal to Disney, but it’s awkward that Captain America is tied up just because they used him for a crummy little fast food joint. They otherwise could design something around all their Avengers characters.

We’re talking about the distant future right now, though. It’ll be years before we even see the first Disney-distributed Marvel film.

Santayana • on Sep 1, 2009 7:11 am

Would somebody at Disney please give Stan Lee a call? Marvel wouldn’t be worth a handful of excelsior without his genius, and it isn’t like he’s not available. To adapt a phrase I heard somewhere, with great buying power comes great artistic responsibility.

Jason • on Sep 1, 2009 7:11 am

Actually, Stan Lee has been working with Disney since 2007. His company POW has a deal with them.

You know, the Universal License and Boom!’s Pixar license were honestly my only real ‘issues’ with the buyout. I don’t know why everyone started panicking. Disney may be a huge, somewhat evil corporation, but they’re not stupid.

The Mouse has the Tween Girl market cornered, buying Marvel is a step towards roping in the boys too. Watering Marvel down to make it more Disney would not only be a dick move, it would be a bad business decision if the goal is indeed to attract more adolescent boys to the brand.

Besides, Bugs Bunny has owned Batman for years! Now Mickey owns Wolverine, how is anyone REALLY this shocked?

Ted • on Sep 1, 2009 7:11 am

Once Disney starts REALLY promoting these characters (and MORE importantly, profitting off them), I suspect that most of these other film studios will lose interest and will gladly sell their rights back. Why spend YOUR hard earned money to promote your RIVALS characters, when you can spend YOUR money to promote your OWN characters?
This is why I have always thought that it is dumb for theme parks to sign outside licensing deals. Disney (with few exceptions) has been the ONLY one that is smart about this.

Melissa Harper • on Sep 1, 2009 7:11 am

As far as I know, the only outside licensing Disney does is with the Star Wars universe. Now, that is going to be a fun time- Star Wars/ Marvel Weekends!

CJ • on Sep 1, 2009 7:11 am

Universal should just get it over with and fork over the rides, chracters et al. They could make a deal with paramount for a Star Trek attraction and replace it all. Then they could host the conventions and make a bundle.